Question
In: Accounting
In 2019, 3 friends (Tom, Rob and Susan) incorporate Rags Pty Ltd to operate a retail...
In 2019, 3 friends (Tom, Rob and Susan) incorporate Rags Pty Ltd to operate a retail fashion shop that only sells latest trendy fashion designs. Tom and Rob each held 45% of issued shares; Susan held remaining 10% of the shares. Company’s constitution stated all 3 were directors, with Tom appointed as MD.
Susan is very critical of Tom’s management but lacks the support of Rob in confronting Tom about his management style. Rob tells Tom about Susan’s dissatisfaction.
To teach Susan a lesson, Tom and Rob decide to incorporate a new company called Ribbons and Rags Pty Ltd in which Tom and Rob are equal shareholders. Ribbons and Rags Pty Ltd trades in the neighbouring suburb and Tom and Rob divide their time between the two businesses which sell similar products.
Susan is unhappy when she hears about these developments but is unsure what she can do. Susan feels that she has been outsmarted by her friends.
Advise Susan whether:
(a) Tom and Rob have breached any directors duties owed to Rags Pty Ltd under the Corporation Act [10 marks]; and
(b) What remedies are available to Rags Pty Ltd [10 marks] and
(c ) Advise ASIC on penalties available under the Corporations Act for breach of duties identified above [10 marks].
TLAW 607 (Topic 10) Members 33 Rights and Remedies
Solutions
ekkarill92 answered 1 year agoRelated Solutions
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Required:
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Hoping to make his flight on time, Tom (the CEO of ABC Pty Ltd) signed a...
Hoping to make his flight on time, Tom (the CEO of ABC Pty Ltd)
signed a stack of paperwork on his desk without reading what he was
signing. Unfortunately, one of the documents he signed authorised a
high-risk investment which caused shareholders to lose millions of
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Required:
(a) With reference to CA s 180, how does the court decide
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Adjustable Value Method Effective Life Decline in Value for This
Period Closing Adjustable Value Printer 1,200 1,200 Diminishing
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2,100 Appliances 2,600 1,040 Prime Cost 5 years 520 520 All
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2018 - 2019 Income year is shown as follows: Asset Cost Opening
Adjustable Value Method Effective Life Decline in Value for This
Period Closing Adjustable Value Printer 1,200 1,200 Diminishing
Value 3 years 400 800 Desks 3,000 2,400 Prime Cost 10 years 300
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(iii) Which was the more successful division? Explain. (Hint:
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operations:
Furnishing department...
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